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Uber Starts Charging What It Thinks You're Willing To Pay (bloomberg.com)
An anonymous reader quotes a report from Motherboard: Uber drivers have been complaining that the gap between the fare a rider pays and what the driver receives is getting wider. After months of unsatisfying answers, Uber is providing an explanation: It's charging some passengers more because it needs the extra cash. The company detailed for the first time in an interview with Bloomberg a new pricing system that's been in testing for months in certain cities. On Friday, Uber acknowledged to drivers the discrepancy between their compensation and what riders pay. The new fare system is called "route-based pricing," and it charges customers based on what it predicts they're willing to pay. It's a break from the past, when Uber calculated fares using a combination of mileage, time and multipliers based on geographic demand. Daniel Graf, Uber's head of product, said the company applies machine-learning techniques to estimate how much groups of customers are willing to shell out for a ride. Uber calculates riders' propensity for paying a higher price for a particular route at a certain time of day. For instance, someone traveling from a wealthy neighborhood to another tony spot might be asked to pay more than another person heading to a poorer part of town, even if demand, traffic and distance are the same.
Other companies will adopt this as well. They will charge you what you are willing to pay them. You won't even be safe outside of the online world, in retail shops the price tags will adopt depending on the time of day and maybe even, combined with face tracking, who is around.
"...How much you got!?"
(I think they call this a shake down)
So now do you understand why taxi companies are regulated?
Dahon makes these wonderful fold-up bikes you can take on mass transit and not look like an asshole (though you will look like a bear riding a bicycle).
When you make pricing unpredictable, customers are going to stay away in droves. As will I.
"But you're taking your life in your hands by biking in Boston"
It's not any worse than say, Providence or Warwick.
--
BMO
Tony the tiger??? Is it great? Tigers have stripes, not spots.
...Uber starts paying its drivers what it thinks they're willing to accept.
Why should you have to do this?
Time to support your LOCAL taxi companies again. These guys are proven to be crooks over and over?
Donate your money to a good cause if you have too much.
Someone travelling from a poor neighborhood to a fast food joint when the work shift starts will be asked to pay more than someone going from movie theater to starbucks, because the former might not have any other transportation and can be squeezed dry.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
isn't the purpose of Taxi regulations is to make sure that the price is consistent regardless of time of day or distance? Oh wait, Uber thinks they're exempt from taxi regulations
I honest didn't give a damn about all the weird stuff Uber and its CEO have been doing to various parties. All politics, embarrassments, etc. - don't care... As long as 1) the ride is cheaper, and 2) the drivers are good, that's fine.
This change, however, strikes a nerve for me personally. It's a combination of Big Brotherly data accumulation and usage against people, along with a heaping helping of, "Screw you, rich boy," shakedown.
If this is the way data collection is going, and how it'll be used, then THIS kind of abuse of people's wallets may finally be what wakes up the average Joe as to why privacy still matters.
This!
When I Ubered from the Orlando, FL airport, the ride was wicked expensive because to service the airport, there were special requirements (black limo or upscale SUVs only) and the driver said they had to pay $1000 per year for the privilege of picking up fares there.
The return trip to the airport was half the cost, and that driver explained the strategy for my next trip. Get your airport ride to the nearest restaurant, and then call a normal Uber from there to wherever you are actually headed.
I thought that was a wonderful market response to Uber price gouging.
You do have a point. The corporate world has concentrated production and ownership into far too few hands. When the production of sustenance level items, e.g. food was in the hands of thousands of small producers things were much more robust and stable. I buy much of my food from local producers and the open farmers market, often bartering my labor and skills in the computer industry for goods. I also realize that isn't an option for most people...
errr....umm...*whooosh* *whoosh* Is this thing on ?
Uber has learned what airlines have long known - you can screw the customer over at will and with little fear of retribution because you're not the one at the pointy end of the customer-interface spear. Gate agents and check-in agents take 90% of the heat for airline behavior, and Uber drivers, who aren't getting any of the extra cash, will take the heat for the Uber higher-ups who make the policy, set the prices, and rake in the cash. Capitalism, gotta love it.
This is exactly how markets are supposed to work. If there is a temporary shortage, the price should go up so that people with an urgent need can get what they want, while people (like you) that are willing to wait get lower prices.
I will give you a nice example how I saw the market working. A dozen years ago, the drivers driving petrol trucks in Britain went on strike. Huge queues at all petrol stations. One owner of a petrol station decided to take advantage of the situation and doubled his prices. People had to pay, he made a mint.
Then the strike was over. His petrol station was absolutely empty. It took six weeks until he was bankrupt. And that's how it should work. Gouge me and there will retribution.
Huge queues at all petrol stations. One owner of a petrol station decided to take advantage of the situation and doubled his prices.
There are plenty of people who would much rather pay double than waste an hour in a queue. These people would be grateful that someone had the sense to price to market.
People had to pay, he made a mint.
Except that no one HAD to pay. They could continue to wait in the queues at the other petrol stations. They were just offered the additional option of paying with money rather than time. Since he "made a mint" it is clear that many people preferred than option.
Then the strike was over. His petrol station was absolutely empty. It took six weeks until he was bankrupt.
Of course you just made all this up. In the absence of price controls, ALL of the stations would have raised their prices. Feel free to provide a citation to prove me wrong.
Why stop at setting fares based on "how much *groups* of customers are willing to shell out "? Uber has a personal relationship with you, don't they? So they can experiment with your *personal* willingness to pay ... if you are a regular customer, they can keep upping your price a little bit, then do it a little more at rush hour to see how likely you are to accept high rates under stressful conditions. Come to think of it, maybe they can figure out a way to get your heart rate from your smart watch to get an even better read on your state of mind.
My Libertarian friends will probably still say that the market will sort it out. Free foxes in free hen houses! But maybe we can save everybody a lot of grief by reigning in a company that has shown so many times that it will do whatever it can get away with.
Back to the robber baron times.
People think they are smarter than their grandparents when actually they are so much more dumb that they don't even notice it.
You see, there is a reason for regulations, for fixed fares, for trade union wages and all that "evil government" stuff. The reason is called peace of mind.
Sure I can go through life negotiating every small deal, always checking all the prices, always on the edge making sure nobody takes advantages of me while I try to use every opportunity there is. What a stressful way to live your life!
When you travel the same way multiple times, you learn very fast how much the taxi rate is. If you travel in the same city a lot, you can quickly make reasonable estimates. Because of fixed prices. I can decide to take the taxi to the airport tomorrow, estimating what it will cost me and deciding the saved time is worth it. But when prices change all the time depending on a hundred variables half of which I don't even know, then there is no such calmness. I need to check all the different driving services and compare, and just before booking, not the evening before. Then I need to make sure none of the surge charging or other modifiers changes the price at the last minute.
Why should I fuck my brain like that to maybe save a few bucks? Why should the driver go to work in the morning with not the slightest clue how much he'll earn today? The slavery to market mechanics sucks the souls out of all the human beings involved in the transaction. You can do business like that when you have machine-to-machine trading, but us humans, for us all of this dealing is not an end in itself, it is just a tiny part of the life we live, and the mental burden, the uncertainty and unpleasant surprises have an effect far stronger than the monetary optimisation effect.
The "gig economy" is not a new invention. Millions of people throughout the ages lived their lives like that. Short, miserable and poor lives. Nobody ever became rich with gigs. It's just a trick to swindle us out of the health care, unemployment and other social security systems that older generations fought and died for to establish. Everyone pushing this misery ought to be ashamed and beg for forgiveness at the graves of their grand- and grand-grand-parents.
Assorted stuff I do sometimes: Lemuria.org